Crowder Options - Weekly Market Preview

First I would like to inform subscribers that the August Stock Options Expiration Report will be available Monday afternoon (not today, as reported earlier) and from this point forward it will always be available the Monday following options expiration. Go to the Insider’s page to access the report. Now on to the Weekly Market Preview

The higher-beta indexes (QQQQ and IWM) pushed into a short-term overbought state during the latter part of last week. Typically this means that a short-term reprieve is right around the corner. This also means that a potential signal could occur for one or more of my stock options trading strategies, especially the ETF Extremes options strategy.

To compound the already overbought state of the NASDAQ 100 and Russell 2000 is the upcoming post-expiration seasonal weakness that typically enters the market directly following options expiration. Also, over the last eleven years seven have witnessed significant declines in the major market benchmark, the S&P 500 (SPY) during the final five trading days of August. The S&P has lost on average -2.6% during that short time frame. Will it occur again this year? No one knows for certain, but if we are able to hold the current overbought levels or sell-off near-term and rally back to overbought levels as we enter the seasonally weak period at the end of August I would expect to see probability win out once again. We shall see when the time comes. As always I will keep you updated.

See you Monday!

Andy